If you’ve witnessed intergenerational arguments online, it’s a near-certainty you’ve seen Baby Boomers taking flak for hoarding their wealth and leaving their posterity in generational poverty.
A while back, Business Insider backed up those complaints with data. The numbers show that not only have younger generations been robbed, the scope of the generational theft exceeds their accusations.
In 1989, baby boomers (defined in a recent Federal Reserve report as Americans born between 1946 and 1964) were roughly the same age millennials (born between 1981 and 1996) are today. But boomers held 21% of America’s total net worth in 1989 — seven times millennials’ paltry 3% share in 2019, wrote Alex Tabarrok in the blog Marginal Revolution.
The chart below shows what percentage of total US wealth each generation has held since 1990, according to Fed data that extends through 2019 Q2. Over time, the Silent Generation has seen a decline from 80% to 25% of total US wealth, presumably because they’ve begun to pass away and exhaust their retirement accounts and pensions.
As baby boomers age, their percentage of total US wealth has increased from 20% to nearly 60%.
To clarify, while almost everyone younger than the Boomers is getting screwed, when you break Generation Y out from the Millennials in 1989, Gen Y are the biggest losers.
Gen X and millennials haven’t even reached these wealth levels. Thus far, Gen X only comprises about 16% of US wealth. And perhaps most strikingly, the line for millennials is almost completely flat: They’ve barely seen any increase in net worth, coming in at less than 5% of total US wealth in 2019.
It’s worth noting that these generations are younger, so comprising a smaller percentage of US wealth is expected. However, the chart below, which highlights the percentage of US wealth held by age, shows that the young are still financially behind: Their wealth levels are below where they should be.
These figures describe the result of Boomers inheriting history’s biggest windfall, inflating it with one credit bubble after another, and refusing to pass any on to their heirs.
Boomers aren’t just being miserly with their wealth, either. They’ve got an equally tight death grip on power, even though the effects are proving disastrous for the West’s future.
The main reason to amass wealth is not to die with the most toys. It’s to provide a sound support base for your kids to keep building the family legacy and continue the process with their children. That is how civilizations are built and maintained.
But that’s not happening now, and it hasn’t for decades. Instead, three generations were left to raise themselves while their parents chased materialism. Those same parents then handed their kids over to grifters who left them in generational poverty.
Devon Stack had it right, re: the ruling class’ generational wealth vs their subjects’ generational poverty. Our elites’ unprecedented power is maintained by the vast resources their forefathers accumulated over centuries. Their inheritance gives them a nigh-insurmountable advantage in terms of cultural and political influence.
Here’s Stack’s analogy: Imagine time as a 500 k marathon track where each kilometer represents one year. It’s a relay race where each runner passes the baton to his kid, who gets to start at the point where his dad finished.
For the sake of argument, let’s say that all our ancestors started on the same line 500 km/years back from us. Due to differences in natural ability, training, and dumb luck, some of the racers pulled ahead. But the others still had a chance to catch up if they pushed themselves. But the math says that at least some of front runners’ kids would maintain their fathers’ lead, and in some cases expand it.
Eventually, some of the third and fourth-generation runners way out front would run over the horizon from those trailing behind. A number of them would realize that no one would know if they cheated. So, some of them would indulge the temptation to stop running on foot and hop in golf carts. Their already wide lead, which a runner farther back might have been able to overcome with supreme effort, would double. And when no chance existed of anyone discovering their cheating, the golf cart drivers would switch to sports cars, then bullet trains, then supersonic jets.
What are the odds that the succeeding generations who never had to train, but got to ride out the race on the Concord, are as fit as their ancestors who started running?
That explains why we see such gross mismanagement in every sector of commerce. Our rulers have inherited an almost omnipotent machine, but they no longer remember how it works. They have degenerated into a cargo cult that tries to appease the machine with blood rituals and sacrifices.
The machine is incredibly resilient – it was built to be – but one day it will stop. Prepare accordingly.
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